By Douglas Wolf
Pinal County Assessor
Pinal County, Arizona Property tax rates are receiving much scrutiny after the Pinal County Board of Supervisors was forced to increase revenues.
Four key factors affect our property tax base:
• Pinal County is the third most populous county in Arizona
• We have a very small base of commercial property
• We have one of the lowest median home prices in the state
• Only 25 percent of the county is taxable land
A large and growing population necessitates high costs for the delivery of services and for increased investments to keep up with the growth. During the housing boom of the last decade, developers were given free rein to put up as many affordable single family homes as possible. Communities sprouted up overnight with little or no commercial establishments to serve the local population.
There were two negative effects of this rapid growth; First, residential housing provides much less revenue in property taxes than commercial buildings. Second, Pinal residents tend to shop in Pima and Maricopa depriving Pinal of much needed sales tax revenue.
Still Expect Services
Nonetheless, these new residents expect that the budget will increase in order to provide a full complement of county services.
Lots of land, little tax base
On top of these factors, much of the land in the county is under federal, tribal, or state control. The federal government provides token compensation for lost property taxes in the form of PILT payments but state trust lands provide zero revenue to the county.
On top of this, Pinal has the highest portion (35%) of state trust land of any county in Arizona.
The low net assessed value and a growing population, combine to give Pinal one of the lowest net assessed values per capita in the whole state. That is the main reason property tax rates are higher than average. Changing the current situation will take time and a focus on strategic development.
State Funding Cuts
In addition to the other issues we face, the Governor and Legislature passed a budget this year that reduced our share of revenues by $6.8 million dollars.
What we can do?
There are a few things the county can do to improve the situation.
The county should expand its economic development efforts so that companies around the country and around the globe know about all that Pinal County has to offer.
Commercial developments bring a large payback in jobs and additional property tax revenue. Despite minimal resources, the economic development office has identified 16 billion in possible new investments. Imagine what we could do with additional resources!
Another area to evaluate is impact fees. While the county works on long term solutions, it is important to encourage business to come to our county. The county Board has done good work in this area and we must remain competitive with other counties.
It’s also time for the State Land Department to move forward with the Southern Pacific classification yard at Red Rock. The acres required for this valuable project represent a tiny fraction of the 9 million acres held by the department. Incredibly, state land has sold only 10% of their inventory in 102 years of statehood. The lost revenue from property taxes for our public schools over the decades is staggering. Like most strategic plans, the solutions will take time to implement but the long-term payoff will be well worth the effort.
About the Author
Douglas Wolf is the Pinal County Assessor and was elected in 2012.